Uranium Royalty Corp · NASDAQ:UROY
Uranium Royalty — Investor Presentation (March 2023)
40 slides from Uranium Royalty's investor presentation, March 2023
Slide 1: Proven Team, Proven Approach: The First and Only Pure Play Uranium Royalty Company
UROY : NASDAQ URC : TSX-V Proven Team, Proven Approach: The First and Only Pure Play Uranium Royalty Company Corporate Presentation March 2023
Slide 2: Forward-Looking Statement
2 FORWARD-LOOKING STATEMENT Forward-Looking Information The information contained herein contains “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian securiti
Slide 3: Investment Highlights
3 INVESTMENT HIGHLIGHTS ▪ URC is the first company to apply the successful royalty and streaming business model First Mover Advantage exclusively to the uranium sector C$147M ▪ Strong balance sheet, which positions it to capitalize on accretive uranium royalty and Liquid Assets streaming acquisition
Slide 4: Management & Board
4 MANAGEMENT & BOARD Management Board of Directors AMIR ADNANI (Chairman) SCOTT MELBYE (President, CEO & Director) • Entrepreneur and Founder, President & CEO of Uranium Energy Corp • Uranium industry veteran with 39 years experience including Executive (UEC: NYSE American) roles with Cameco, Uraniu
Slide 5: Fundamentals Favor Significant Price Appreciation – US $/lb U3O8
5 FUNDAMENTALS FAVOR SIGNIFICANT PRICE APPRECIATION – PRICES STILL WELL BELOW PREVIOUS HIGHS Spot Daily Long Term $138.00 $140 2005: $120 Major Mine Disruptions US $/lb U308 (Cigar Lake, $70.00 $100 McArthur River) 2011: Fukushima $53.00 $80 event $50.85 $60 $40 Financial Crisis $20 Nov 2016: $17.75
Slide 6: Capitalization & Ownership Profile
6 CAPITALIZATION & OWNERSHIP PROFILE SHARE STRUCTURE RECENT ACTIVITY Shares Outstanding 97.6 Million US$2.39 UROY: Nasdaq Avg. Daily Vol.: 427,030 Warrants 17.6 Million(1) C$3.23 URC : TSX-V Avg. Daily Vol. (3-mo): 87,494 Options 1.2 Million URC.WT : TSX-V C$1.41 Fully Diluted(2) 116 Million Market
Slide 7: Our Strategy: Building a Diversified Portfolio
OUR STRATEGY: 7 7 BUILDING A DIVERSIFIED PORTFOLIO Geographical Multiple countries Counterparty Range of market capitalization Various Stages of Development Near, Medium, and Long-term Assets Invest Across the Cost Curve Maximizes leverage to uranium recovery Physical Ownership Direct Exposure to Cu
Slide 8: URC's Portfolio
URANIUM ROYALTY CORE URC’s Portfolio
Slide 9: Strong Counterparties/Operators
9 STRONG COUNTERPARTIES/OPERATORS Counterparties and Operators include many of the sector’s leading growth-oriented uranium companies
Slide 10: Global Diversified Asset Portfolio
10 GLOBAL DIVERSIFIED ASSET PORTFOLIO Africa Note: Physical storage of yellowcake material is provided at Cameco’s Blind River facility
Slide 11: Strategic Assets – Physical Uranium Investment
11 STRATEGIC ASSETS – PHYSICAL URANIUM INVESTMENT Blind River Uranium Storage Facility ▪ Increased total physical uranium concentrate inventory to 1,748,068 pounds of U3O8 at a weighted average cost of US$43.32 per pound1 (200,000 pounds delivered in February 2023) ▪ US$91M in market value at $50.85
Slide 12: Royalty Portfolio: World Class Athabasca Basin Royalties
ROYALTY PORTFOLIO 12 World Class Athabasca Basin Royalties McArthur River Cigar Lake/Waterbury Roughrider Royalty 1% GOR on 9% share (1) 20% NPI on 3.75% share (2) 1.97% NSR Location Saskatchewan, Canada Saskatchewan, Canada Saskatchewan, Canada Owner / Operator Cameco Corporation Cameco Corporation
Slide 13: Royalty Portfolio: Athabasca Basin Royalties
ROYALTY PORTFOLIO 13 Athabasca Basin Royalties Dawn Lake Russell Lake Royalty 20% NPI on 7.5% share (1) 1.97% NSR Location Saskatchewan, Canada Saskatchewan, Canada Owner / Operator Cameco Corporation Rio Tinto/Skyharbour Resources Orebody Type Unconformity Unconformity Mine Type Open Pit/Undergroun
Slide 14: Royalty Portfolio: McArthur River
ROYALTY PORTFOLIO 14 14 World Class Athabasca Basin Royalties McArthur River (1% GOR on 9% share)(1) ▪ The mine is currently owned by a joint venture between Cameco (69.805%) and Orano (30.195%) ▪ Along with the Key Lake Mill, licensed to produce 25 Mlbs per year ▪ Historical production of 325.4 Mlb
Slide 15: Royalty Portfolio: Cigar Lake/Waterbury
ROYALTY PORTFOLIO 15 15 World Class Athabasca Basin Royalties Cigar Lake/Waterbury (20% NPI on 3.75% share)(1) ▪ The Cigar Lake Joint Venture partners are currently Cameco (54.547%), Orano Canada Inc. (40.453%), and TEPCO Resources Inc. (5%) ▪ Licensed to produce 18 Mlbs per year Overview ▪ Historic
Slide 16: Royalty Portfolio: US ISR Royalties
ROYALTY PORTFOLIO 16 US ISR Royalties Reno Creek (1,3) Lance (1) Dewey-Burdock (1) Church Rock Royalty 0.5% NPI 1% GRR / 4% GRR 30% NPI / 2 – 4% GRR 4% NSR Location Wyoming Wyoming South Dakota New Mexico Geological District Powder River Basin Powder River Basin Black Hills Uplift Grants Mineral Bel
Slide 17: Royalty Portfolio: Global Conventional Royalties
ROYALTY PORTFOLIO 17 Global Conventional Royalties Langer Heinrich (1) Michelin (2,3) Past Producer Ready for Restart Large Resource in Top Jurisdiction Royalty A$.012/kg U3O8 Production Royalty 2% GRR Location Erongo, Namibia Labrador, Canada Owner / Operator Paladin Energy/CNNC Paladin Energy Oreb
Slide 18: US Conventional Royalties – Arizona/New Mexico
ROYALTY PORTFOLIO 18 US Conventional Royalties – Arizona/New Mexico Anderson(1) Workman Creek Roca Honda(3,4) Royalty 1% NSR 1% NSR 4% GRR Location Arizona Arizona New Mexico Geological District Date Creek Basin Sierra Ancha/Apache Basin Grants Mineral Belt Owner / Operator Uranium Energy Corp. Uran
Slide 19: US Conventional Royalties – Utah/Colorado
ROYALTY PORTFOLIO 19 US Conventional Royalties – Utah/Colorado Slick-Rock(2) Whirlwind(1,3,5) Energy Queen(1,3,6) San Rafael(1,4,7) Royalty 1% NSR 2 – 4% GOR 1% GRR 2% NSR Location Colorado Utah/Colorado Utah Utah Geological District Grants Mineral Belt Uravan Mineral Belt La Sal Mineral Belt San Ra
Slide 20: Royalty Model & Our Approach
20 Royalty Model & Our Approach
Slide 21: URC Offers Partnership 'Value-Added' Relationships with Portfolio Counterparties
21 21 URC OFFERS PARTNERSHIP “VALUE-ADDED” RELATIONSHIPS WITH PORTFOLIO COUNTERPARTIES URC is vested in the success of its portfolio counterparties Thorough due diligence and Ability to provide selection process offers third party non-dilutive Project Financing endorsement to projects in the URC por
Slide 22: The Right Model for an Improving Market
22 THE RIGHT MODEL FOR AN IMPROVING MARKET Operating Physical Funds Royalty Companies vs. Operators Uranium ETF Companies Exposure to Uranium Price ✓ ✓ ✓ ✓ Fixed Operating Costs ✓ ✓ ✓ No Development or Sustaining Capital Costs ✓ ✓ ✓ Exploration & Expansion Upside Without the Associated Costs ✓
Slide 23: Our Strategy: Royalty Opportunity
23 OUR STRATEGY: ROYALTY OPPORTUNITY ▪ To date URC’s strategy has been primarily ▪ Large number ▪ Focused of active discussions focused on acquiring existing royalties dialogues with priority targets ▪ Typically for shares and/or ▪ Typically cash cash transaction ▪ The next wave of acquisitions are
Slide 24: Uranium Market Overview
URANIUM ROYALTY CORF Uranium Market Overview
Slide 25: Nuclear Energy
25 Nuclear Energy Clean, Safe, Reliable & Economic Perfect Complement to Renewable Wind and Solar Provides Hedge Against High Natural Gas Prices Saves Lives and Improves Quality of Life
Slide 26: Nuclear Power = Carbon Free - Clean Energy
26 26 NUCLEAR POWER = CARBON FREE - CLEAN ENERGY 55% OF AMERICA’S CLEAN ENERGY The only low carbon energy source that provides scalable, 24-7 baseload power Source: World Nuclear Association – Harmony Program
Slide 27: Nuclear Power = Safest Form of Electricity Generation
27 27 NUCLEAR POWER = SAFEST FORM OF ELECTRICITY GENERATION Source: World Nuclear Association – Harmony Program https://world-nuclear.org/our-association/what-we-do/the-harmony-programme.aspx
Slide 28: 2021 Polar Vortex – Nuclear Reliability at 95%
28 2021 POLAR VORTEX – NUCLEAR RELIABILITY AT 95% 28 CAPACITY FACTOR BY ENERGY SOURCE IN 2020 Nuclear 92.5% Geothermal 74.3% Natural Gas 56.6% Hydropower 41.5% Coal 40.2% Wind 35.4% Solar 24.9% Source: U.S. Energy Information Administration
Slide 29: Nuclear Power = Lowest Levelized Cost of Electricity
29 29 NUCLEAR POWER = LOWEST LEVELIZED COST OF ELECTRICITY FOR EXTENDED LIFE PLANTS VS ANY OTHER SOURCE Most nuclear plants in the U.S. have or will extend their operational lives by at least 20 - 40 years Projected Costs of Generating Electricity, 2020 Edition, International Energy Agency and Nucle
Slide 30: Global Approval for Nuclear Power Continues to Grow
30 30 Global Approval for Nuclear Power Continues to Grow EU Taxonomy Includes Nuclear as an Environmentally Sustainable Investment Source: U.S. Energy Information Administration; Orano Group
Slide 31: Support for Nuclear Energy Is Strong and Increasing
31 31 SUPPORT FOR NUCLEAR ENERGY IS STRONG AND INCREASING Favorability to Nuclear Energy 1983-2022 Overall, do you strongly favor, somewhat favor, somewhat oppose the use of nuclear • 86% agreed that we energy as one of the ways to provide electricity in the United States? should renew the license o
Slide 32: Robust Nuclear Power Growth
ROBUST NUCLEAR POWER GROWTH – 32 More than a doubling of nuclear generation by 2050 11 Global investments in nuclear energy generation are projected to average well over $100 B per year through mid-century8 438 58 66 3.1% Operable Reactors Units Under New Reactors Connected CAGR1 Uranium Demand Grow
Slide 33: Reactor Demand Significantly Exceeds Primary Production
33 REACTOR DEMAND SIGNIFICANTLY EXCEEDS 33 PRIMARY PRODUCTION U.S. Uranium Production Needed to Fill Gap 2023 Demand expected ~ 194 M Lbs. 2023 Production expected ~ 143 M Lbs. 2023 Production gap is > 50 M Lbs. below requirements Cumulative gap in 2030 is ~345 M Lbs. and ~454 M Lbs. by 2032 Source:
Slide 34: Uranium Supply – Accelerated Rebalancing
34 34 URANIUM SUPPLY – ACCELERATED REBALANCING Restricted Primary Supply 2016 – 2035 Mine Curtailments, Depletion and Speculative Interest Accelerating Market Rebalancing Source: TradeTech May 31, 2021
Slide 35: Need for New Production – Beyond Existing Mines
35 URANIUM DEMAND Need for New Production – Beyond Existing Mines ▪ Inventory Overhang Drawn Down ▪ Uranium Price Too Low to Stimulate New Production ▪ Within the Permitting and Development Lead Times to Bring On © 2019 New Mines Source: TradeTech October 2022 *2022 Q2 U3O8 Requirements reflect West
Slide 36: Utility Procurement Cycle: Old Contracts Rolling Off
36 UTILITY PROCUREMENT CYCLE: 36 Old Contracts Rolling Off… New Contracts Need to be Signed 1.3 Billion Pounds of Contracting needed by 2035! Utility Uncommitted Demand Historic Long-Term Contracting Source: UxC Market Outlook Q4 2022
Slide 37: Offers Investors
37 OFFERS INVESTORS: ▪ First mover pure-play uranium royalty exposure ▪ Diverse royalty portfolio in key jurisdictions ▪ Physical uranium exposure ▪ Experienced team that understands uranium’s unique risks/rewards ▪ Nuclear energy gaining broader acceptance in a carbon-constrained world ▪ Robust ura
Slide 38: Royalty and Streams 101
38 38 ROYALTY AND STREAMS 101 “Royalties” are a payment to a royalty holder by a property owner, or project operator, and is typically based on a percentage of the minerals produced and the revenues or profits generated from the property “Streams” are physical commodity purchase agreements where, in
Slide 39: Types of Royalties
39 TYPES OF ROYALTIES ▪ Based on the total revenue stream from the sale of production from the property, which can sometimes include Gross Overriding Royalty deductions. (GOR) ▪ URC GOR royalties include McArthur River and Whirlwind ▪ Based on the total revenue stream from the sale of production fro
Slide 40: The First and Only Pure Play Uranium Royalty Company
40 UROY: NASDAQ | URC: TSX-V The First and Only Pure Play Uranium Royalty Company Uranium Royalty Corp. Corporate Office: President & CEO: Toll Free: 1.855.396.8222 1030 West Georgia Street, Scott Melbye Phone: 604.396.8222 Suite 1830, Vancouver, Email: Info@UraniumRoyalty.com BC, V6E 2Y3 Investor R